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5 things you need to know to survive a Medicare audit

Careful documentation and billing compliance can help you successfully navigate the audit process


The following is paid content sponsored by EMS Management & Consultants.

By EMS1 BrandFocus Staff

Ambulance providers are more likely than ever to face Medicare audits. Most challenged claims are flagged because of incorrect or incomplete documentation, and it’s important to train medics as well as billing staff on the latest regulations to maximize coding and billing compliance, enlisting a third-party provider if necessary.

It’s important to have an active compliance plan in place, as well as a compliance manager to conduct internal quality assurance audits. (iStock Photo/vitanovski)
It’s important to have an active compliance plan in place, as well as a compliance manager to conduct internal quality assurance audits. (iStock Photo/vitanovski)

Here are five things you need to know to prevail in an audit.

1.  Know the common audit triggers. 
A number of factors can prompt a Medicare billing audit, including a tip from a disgruntled employee, but most are driven by a statistical analysis done by your Medicare Administrative Contractor.

These audits take two forms: prepayment review and post-payment review. In both cases, the MAC investigates three key elements of each claim:

•  Is it Advanced Life Support or Basic Life Support?

•  Is it an emergency or non-emergency response?

•  Is the ambulance transport medically necessary?

Providers have up to 30 days to submit the required documentation, and the MAC has up to 60 days to send its response. If the contractor does not receive information in a timely manner, it’s an automatic denial, and unanswered requests can increase the scope of the audit.

2. Know what to expect in both prepayment and post-payment reviews.  
In a prepayment review, the ambulance provider will receive one letter requesting documentation for every flagged claim, usually for the same service, to be reviewed individually. These reviews are typically triggered when the Medicare contractor determines that a provider ranks higher in ALS or emergency procedures as compared to their geographical peers. This is often apples to oranges, as the country fire/EMS service will naturally have a different patient profile than a private ambulance service specializing in dialysis or nursing home transports.

“When they try to compare ambulance providers using these standard statistical models, it’s very difficult because providers do specialize in certain types of calls,” said Kim Stanley, chief customer officer for EMS Management & Consultants, which specializes in ambulance billing and compliance. “It’s really not good statistical data to be able to compare apples to apples. They’re just known as an ambulance provider for Medicare.” 

A post-payment review examines the provider’s entire universe, using a set of randomly selected trips for statistical analysis. (RAT-STATS, the statistical tool used for these reviews, is available as a free download for providers to perform in-house compliance audits). The provider then is required to submit all of the medical records for those trips to the MAC.

If the MAC’s analysis determines a high rate of error, that rate is extrapolated to all the claims across that provider’s universe. For example, if they determine a 40 percent error rate on 90 randomly selected trips over 24 months, then Medicare has the justification to apply that error percentage to every claim submitted in that same two-year period.

The provider will then receive a letter that specifies an amount that must be repaid. If Medicare doesn’t receive payment within the allotted time, the money – plus interest – will be withheld from future checks.

3. Boost compliance by training medics and staff to keep meticulous records.  
It’s important to have an active compliance plan in place, as well as a compliance manager to conduct internal quality assurance audits, Stanley said. Part of that compliance plan should include training for both medics and billing staff to ensure that they are up to date on the latest regulations. This demonstrates due diligence if you are audited. 

Train medics on what information is needed in a patient care report so that the billing department can apply the correct codes. That training should not be geared toward getting every claim paid, warns Stanley. Details matter, but medics should never add or omit information in an attempt to justify basis for payment.

“Give me enough information to make a good decision as to whether it’s medically necessary,” she said.

Also be sure to provide the required signatures. Make sure that medics’ signatures are legible and their credentials provided on each PCR. (PCR software helps with this requirement by providing e-signatures when medics log in.) Non-emergency ambulance transports also require a valid physician certification statement with legible signatures from an appropriate medical clinician (MD, RN, etc.).

4. Always appeal.  
Stand by your coding and don’t be afraid to appeal, Stanley advises. 

“Just because you’ve received a refund request from Medicare does not mean that the services may not be payable. You should always exercise your appeal rights,” she said. “We should be prepared to stand behind our coding decisions and to appeal those claims that we feel have been denied in error.”

The Medicare appeals system has four sequential levels. The first two are reviewed by Medicare contractors and handled by written correspondence. The third and fourth are reviewed by independent contractors or an administrative law judge, and providers can request a call or visit to discuss the issue. Further appeals go to federal court.

5. Enlist a third party for help.  
A billing and compliance specialist can help navigate the process, handling billing, audits and appeals on your behalf. A company like EMS Management & Consultants can also offer an external review of your billing practices and a mock audit to identify aberrancies and assess risk. 

And if you handle your own billing but find yourself in the middle of an audit, a third party can step in to assist with the appeals process and let your staff focus on helping patients.

“The meat and potatoes of what we do is provide billing services that are compliant with the latest Medicare regulations,” Stanley said, “but we’ve had millions of dollars overturned in unnecessary overpayments that our clients did not have to pay based on our appeals process.”

For more information on billing compliance and Medicare audits, contact EMS Management & Consultants.

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